internal audit report-siz-december-final - miami...

OFFICE OF MANAGEMENT AND COMPLIANCE AUDITS

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MIAMI-DADE COUNTY PUBLIC SCHOOLS

The financial statements were fairly stated and internal controls were mostly

satisfactory; however, at one school, controls in selected areas need to improve.

Front Cover: Allapattah Middle School

THE SCHOOL BOARD OF MIAMI-DADE COUNTY, FLORIDA

Mr. Agustin J. Barrera, Chair Ms. Perla Tabares Hantman, Vice Chair

Mr. Renier Diaz de la Portilla Ms. Evelyn Langlieb Greer Dr. Wilbert “Tee” Holloway

Dr. Martin Karp Ms. Ana Rivas Logan

Dr. Marta Pérez Dr. Solomon C. Stinson

Dr. Rudolph F. Crew

Superintendent of Schools

Ms. Carolyn Spaht Chief of Staff

Mr. Allen M. Vann, CPA

Chief Auditor Office of Management and Compliance Audits

Contributors to this Report:

School Audits Performed by:

Ms. Martha Anderson Ms. Yvonne Barrios

Mr. Harry Demosthenes Ms. Vivian Ferradaz Ms. Jeanette Hanna Ms. Maite Jimenez

Mr. Reginald Lafontant Ms. Latosha Styles

School Audits Reviewed by:

Ms. Germa Garcia, CPA Ms. Maria T. Gonzalez, CPA

Ms. Teresita M. Rodriguez, CPA

School Audits Supervised and Report Prepared by: Ms. Maria T. Gonzalez, CPA

Ms. Teresita M. Rodriguez, CPA Ms. Tamara Wain, CPA

Property Audits Supervised and Performed by:

Mr. Dario Rosendo, CPA and Property Audits Staff

November 30, 2007 Members of The School Board of Miami-Dade County, Florida Members of The School Board Audit Committee Dr. Rudolph F. Crew, Superintendent of Schools Ladies and Gentlemen: This report includes the audit results of 24 schools from the School Improvement Zone. The audit period was the fiscal year ended June 30, 2007. The main objectives of these audits were to express an opinion on the financial statements of the schools, evaluate compliance with District policies and procedures, and ensure that assets are properly safeguarded. The audits included a review of internal funds, property, and payroll records and procedures at all the schools. On a selected basis, we reviewed credit card purchases, aspects of data security and Title I Program expenditures. Our audits disclosed that the financial statements of the schools reported herein were fairly stated. Of the 24 schools, 23 were generally compliant with prescribed policies and procedures, their records were maintained in good order, and their inventoried property was properly accounted for. Although internal controls were mostly satisfactory, improvements are needed in selected areas of internal funds and property management at one of the schools reported herein. The audit findings were discussed with school and district administration and responses to the findings are included in this report. In closing, our Schools Audits Division would like to acknowledge the schools’ staff and administration for the cooperation and courtesies extended to the audit staff during the conduct of these audits. Sincerely,

Allen M. Vann, CPA Chief Auditor Office of Management and Compliance Audits

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Office of Management and Compliance Audits School Board Administration Building • 1450 N.E. 2nd Ave. • Suite 415 • Miami, FL 33132

305-995-1318 • 305-995-1331 (FAX) • www.mca.dadeschools.net

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TABLE OF CONTENTS Page

Number EXECUTIVE SUMMARY ............................................................................................ 1 CONDENSED ANNUAL FINANCIAL STATEMENTS ................................................ 5 INTERNAL CONTROLS’ RATING ............................................................................. 7 SUMMARY SCHEDULE OF AUDIT FINDINGS ......................................................... 8 LIST OF CURRENT PRINCIPALS ............................................................................. 9 PROPERTY SCHEDULES ....................................................................................... 10 FINDINGS AND RECOMMENDATIONS INTERNAL FUNDS 1. Improve Controls Over Yearbook Activities

MIAMI CENTRAL SENIOR ............................................................................ 11 2. Adhere To Limits Over Transfers Of Vending Machine Commissions

To The Special Purpose Account MIAMI CENTRAL SENIOR ............................................................................ 13

PROPERTY 3. Improve Controls Over Property Inventory MIAMI CENTRAL SENIOR ........................................................................... 14 OBJECTIVES, SCOPE AND METHODOLOGY ....................................................... 15 BACKGROUND ........................................................................................................ 17 ORGANIZATIONAL CHART .................................................................................... 20 APPENDIX – MANAGEMENT’S RESPONSES ....................................................... 21

Allapattah Middle School

2

At-a-Glance Audit Results

23 of 24 schools were in compliance with prescribed policies and procedures and their records were in order

Schools

receipted approximately $2.9 million during FY 2006-07

Total Cash

and Investments as of June 30, 2007 amounted to $1.14 million

EXECUTIVE SUMMARY The Office of Management and Compliance Audits has completed the audits of 24 schools from the School Improvement Zone. The audit period was for the fiscal year ended June 30, 2007. Additionally, we have reviewed six other Schools Improvement Zone schools as a result of a recent change of principal. Those results have been reported separately, along with the various regional center schools that have undergone similar administrative changes. The remaining nine schools from School Improvement will be reported at a later date. The audits disclosed that records were maintained in good order and in accordance with prescribed policies and procedures at the 23 of the 24 schools reported herein. At Miami Central Senior High School, we found deficiencies in selected areas of internal funds and property management. Notwithstanding the conditions and findings reported herein, the financial statements of all 24 schools present fairly, in all material respects, the changes in fund balances arising from cash transactions of the internal funds of these schools during the 2006-07 fiscal year, on the cash basis of accounting. As of June 30, 2007, total combined receipts and disbursements amounted to $2.92 million and $2.99 million, respectively; while total combined cash and investments amounted to $1.14 million. Also, as of June 30, 2007, the internal control structure at the schools generally functioned as designed by the District and implemented by the school administration, except for those conditions reported at the aforementioned school.

Miami-Dade County Public Schools 1


At Miami Central Senior, proper procedures to process yearbook disbursements and vending commissions’ transfers were not followed

Also at this school, 22 items at a cost of $39,738 and a depreciated value of $13,232 reported missing. Similar condition found in prior year’s inventory audit

INTERNAL FUNDS Of 24 schools, 23 were in compliance with the procedures established in the Manual of Internal Fund Accounting.

At Miami Central Senior, proper disbursement procedures to process the yearbook invoice were not followed; while the number of yearbooks purchased was excessive considering that demand for the books was low. Also, contrary to procedures, the school transferred to the Special Purpose account vending commissions in excess of 25% of the total received without the requisite approval from School Improvement administration. Most funds were depleted by year-end.

PROPERTY This report includes the current property inventory results of all 24 schools, as well as the results of one school pending since our last audit report in September. The total amount inventoried at these schools was approximately $15.2 million. Refer to Property Tables on page 10. Results disclosed that 24 of the 25 schools were in compliance with property procedures and there were “no unlocated” items.

At Miami Central Senior, 22 items at a cost of $39,738 and a depreciated value of $13,232 were reported as “unlocated”. These losses, which are very similar to those reported in the prior year’s audit, are indicative that controls over the management and safeguarding of property are weak and in need of immediate attention.

Property losses reported through Plant Security Reports at nine schools consisted of 20 items at a cost of $26,340 and a depreciated value of $9,544.

2 Internal Audit Report School Improvement Zone Schools


Payroll function was generally compliant at all 24 schools

P-Card Program procedures at nine schools generally compliant with procedures

Data Security Report reviewed at eight schools without exception

PAYROLL Our review of the payroll preparation and check distribution procedures disclosed that there was generally adequate segregation of the functions of the payroll preparation, authorization, and check distribution at the schools. In addition, the payroll rosters were generally supported by adequately prepared attendance sheets as described by the Payroll Processing Procedures Manual. PURCHASING CREDIT CARD (P-CARD) PROGRAM We reviewed the P-Card Program’s procedures and transactions at the following nine schools:

Thena C. Crowder Elementary Martin L. King Elementary Lakeview Elementary Toussaint L’Ouverture Elementary Norland Elementary Santa Clara Elementary Allapattah Middle Hialeah-Miami Lakes Senior Miami Norland Senior

Our audits disclosed that there was general compliance with the Purchasing Credit Card Program Policies & Procedures Manual. DATA SECURITY QUARTERLY MANAGEMENT REPORT AND APPROVAL REVIEW We reviewed the “Authorized Applications for Employees by Locations Report(s)” at the following eight schools:


4


Access to student grade changes properly restricted at schools reviewed

Title I Program procedures and expenditures reviewed at Paul L. Dunbar Elementary generally compliant

Touissaint L’Ouverture El. Miami Central Sr. Phillis Wheatley El. Miami Edison Sr. Norland Middle Miami Jackson Sr. Hialeah-Miami Lakes Sr. Miami Norland Sr.

The audits disclosed that, generally, the report was signed by the principal to indicate that employees were properly authorized to access certain computer applications; and the computer application that allows for academic grade changes was generally limited and restricted to the principal, one assistant principal, and the registrar. Any discrepancies found during the audit were discussed with the administration and corrected during the audit. TITLE I PROGRAM We conducted a review of Title I Program expenditures and procedures at Paul Lawrence Dunbar Elementary School. Total expenditures posted to the various Title I program accounts amounted to $854,651 for the 2006-07 fiscal year. Results disclosed that the school was generally compliant with the policies and procedures established by the Title I Administration Handbook and the Title I School-Based Budget System Manual. AUDIT OPINION The following table summarizes total cash receipts and disbursements, and financial position of cash and investments at June 30, 2007 for all 24 schools reported herein. It also provides the audit opinion regarding the schools’ financial statements:


SCHOOL IMPROVEMENT ZONE SCHOOLS CONDENSED ANNUAL FINANCIAL REPORTS AND TOTAL CASH AND INVESTMENTS AS OF JUNE 30, 2007

Miami-Dade County Public Schools 5 Internal Audit Report School Improvement Zone Schools

Schools Beginning Balance Receipts Disbursements End Balance Cash Investments Other

Total Cash and Investments

Bunche Park Elementary $ 18,781.02 $ 20,659.35 $ 22,828.34 $ 16,612.03 $ 5,509.06 $ 11,102.97

- $ 16,612.03

Thena C. Crowder El.

3,911.61

10,348.31

9,195.55

5,064.37

2,577.52

2,486.85

-

5,064.37

Paul L. Dunbar El.

14,951.59

15,271.65

13,222.03

17,001.21

9,158.92

7,842.29

-

17,001.21

Florida City Elementary

13,233.25

42,699.67

40,809.49

15,123.43

5,498.26

9,625.17

-

15,123.43

Holmes Elementary

12,363.55

6,675.41

6,915.34

12,123.62

7,689.22

4,434.40

-

12,123.62

Martin L. King El.

15,086.56

15,717.50

18,461.39

12,342.67

9,501.23

2,841.44

-

12,342.67

Lakeview Elementary

11,264.95

11,625.66

14,596.55

8,294.06

5,326.91

2,967.15

-

8,294.06

Little River Elementary

7,231.44

15,683.27

13,567.62

9,347.09

6,240.02

3,107.07

-

9,347.09

Toussaint L'Ouverture El.

5,457.88

39,597.32

40,829.84

4,225.36

2,760.38

1,464.98

-

4,225.36

Morningside Elementary

14,500.90

26,168.12

25,203.59

15,465.43

11,092.96

4,372.47

-

15,465.43

Norland Elementary

8,818.26

48,752.22

46,143.09

11,427.39

5,529.98

5,897.41

-

11,427.39

Santa Clara Elementary

7,460.37

18,380.75

18,875.13

6,965.99

1,864.20

5,101.79

-

6,965.99

Shadowlawn Elementary

19,344.91

36,071.53

29,847.26

25,569.18

2,679.77

22,889.41

-

25,569.18

Phillis Wheatley El.

15,157.75

17,340.71

21,075.05

11,423.41

3,005.04

8,418.37

-

11,423.41

Allapattah Middle

30,957.91

51,644.31

52,712.78

29,889.44

6,758.96

23,130.48

-

29,889.44

Horace Mann Middle

32,719.91

71,502.76

79,214.14

25,008.53

945.51

24,063.02

-

25,008.53

Norland Middle

77,483.11

253,110.78

251,316.36

79,277.53

39,411.27

39,866.26

-

79,277.53

Parkway Middle 25,227.61 37,623.70 32,725.09 30,126.22 11,849.35 18,276.87 - 30,126.22

SCHOOL IMPROVEMENT ZONE SCHOOLS CONDENSED ANNUAL FINANCIAL REPORTS AND TOTAL CASH AND INVESTMENTS AS OF JUNE 30, 2007


Schools Beginning Balance Receipts Disbursements End Balance Cash Investments Other

Total Cash and Investments

Westview Middle

29,763.48

59,397.61

57,728.24

31,432.85

20,530.04

10,902.81

-

31,432.85

Hialeah-Miami Lakes Sr.

226,812.50

540,611.28

564,106.82

203,316.96

60,634.95

142,682.01

-

203,316.96

Miami Central Senior

166,601.04

507,160.90

498,084.45

175,677.49

60,025.54

115,651.95

-

175,677.49

Miami Edison Senior

181,050.51

254,609.56

312,502.33

123,157.74

18,084.37

105,073.37

-

123,157.74

Miami Jackson Senior

138,050.56

336,624.85

360,034.46

114,640.95

47,005.55

67,635.40

-

114,640.95

Miami Norland Senior

138,129.53

479,012.81

459,637.53

157,504.81

64,655.90

92,848.91

-

157,504.81

Total

$1,214,360.20 $ 2,916,290.03 $ 2,989,632.47 $ 1,141,017.76 $408,334.91 $732,682.85

- $ 1,141,017.76 Audit Opinion on Financial Statements and Overall Assessment of Internal Controls Over Financial Reporting

The financial statements of the schools in this audit report present fairly, in all material respects, the changes in fund balances arising from cash transactions of the internal funds of the schools during the 2006-07 fiscal year, on the cash basis of accounting. As of June 30, 2007, total combined receipts and disbursements amounted to $2,916,290 and $2,989,632 respectively; while total combined cash and investments amounted to $1,141,018.

As of June 30, 2007, the internal control structure at the schools generally functioned as designed by the District and implemented by the school administration. When conditions came to our attention that were deemed non-reportable, because they were immaterial and inconsequential, they were nevertheless, discussed with management for their information and follow-up.

___________________________________

Maria T. Gonzalez, Certified Public Accountant Assistant Chief Auditor, School Audits Division

Office of Management and Compliance Audits

SCHOOL IMPROVEMENT ZONE SCHOOLS INTERNAL CONTROLS’ RATING

Internal controls’ ratings of the schools reported herein are depicted as follows:

PROCESS & IT CONTROLS POLICY & PROCEDURES COMPLIANCE

SCHOOLS

SATISFACTORY NEEDS

IMPROVEMENT

INADEQUATE

SATISFACTORY NEEDS

IMPROVEMENT

INADEQUATE EFFECT

Bunche Park El. Not Likely to impact

Thena C. Crowder El. Not Likely

to impact Paul L. Dunbar El. Not Likely

to impact

Florida City El. Not Likely to impact

Holmes El. Not Likely to impact

Martin L. King El. Not Likely to impact

Lakeview El. Not Likely to impact

Little River El. Not Likely to impact

Toussaint L’Ouverture El. Not Likely

to impact

Morningside El. Not Likely to impact

Norland El. Not Likely to impact

Santa Clara El. Not Likely to impact

Shadowlawn El. Not Likely to impact

Phillis Wheatley El. Not Likely

to impact

Allapattah Middle Not Likely to impact

Horace Mann Middle Not Likely

to impact

Norland Middle Not Likely to impact

Parkway Middle Not Likely to impact

Westview Middle Not Likely to impact

Hialeah-Miami Lakes Senior

Not Likely to impact

Miami Central Sr.

Likely to impact

Miami Edison Sr. Not Likely to impact

Miami Jackson Sr. Not Likely

to impact Miami Norland Sr. Not Likely

to impact


SCHOOL IMPROVEMENT ZONE SCHOOLS SUMMARY SCHEDULE OF AUDIT FINDINGS

The following schedule sums up current and prior audit findings per school:

Work Loc. No.

Schools

CURRENT YEAR AUDIT FINDINGS

PRIOR YEAR AUDIT FINDINGS

Total per

School

AREA OF FINDINGS

Total per

School

AREA OF FINDINGS

0641 Bunche Park Elementary None None

2531 Thena C. Crowder Elementary None None 1441 Paul L. Dunbar Elementary None None

2001 Florida City Elementary None None 2501 Holmes Elementary None None

2761 Martin L. King Elementary None None 2821 Lakeview Elementary None None

3021 Little River Elementary None None 3051 Toussaint L’Ouverture El. None 1 Payroll

3501 Morningside Elementary None None

3701 Norland Elementary None None

4841 Santa Clara Elementary None None

4961 Shadowlawn Elementary None None

5931 Phillis Wheatley Elementary None None

6011 Allapattah Middle None None

6411 Horace Mann Middle None None

6571 Norland Middle None 1 Fund-raising

6721 Parkway Middle None None

6981 Westview Middle None 1 Yearbook

7131 Hialeah-Miami Lakes Senior None None

7251 Miami Central Senior 3 Yearbook Transfers Property

3 Fin. Mgt.

Food Prod. Shop Payroll

7301 Miami Edison Senior None None

7341 Miami Jackson Senior None None

7381 Miami Norland Senior None 1 Payroll

TOTAL 3 7


SCHOOL IMPROVEMENT ZONE SCHOOLS PRINCIPALS


The following table lists the name(s) of the principal(s) at each school reported herein during the audit period: Work Loc. No.

School

Principal

0641 Bunche Park Elementary Ms. Beryl James

2531 Thena C. Crowder Elementary Ms. Elisa L. Perez

1441 Paul L. Dunbar Elementary Ms. Marie L. Destin

2001 Florida City Elementary Ms. Gloria M. Arazoza

2501 Holmes Elementary Ms. Dahlia M. Gonzalez

2761 Martin L. King Elementary Ms. Tamme Y. Williams

2821 Lakeview Elementary Dr. Sharon R. Lewis

3021 Little River Elementary Mr. Fernando P. Diaz

3051 Toussaint L’Ouverture Elementary Dr. Liliane A. Delbor

3501 Morningside Elementary Ms. Kathleen John-Louissaint

3701 Norland Elementary Ms. Karen S. Powers

4841 Santa Clara Elementary Ms. Marie Caceres

4961 Shadowlawn Elementary Ms. Gladys G. Gimenez

5931 Phillis Wheatley Elementary Ms. Deloise B. Brown

6011 Allapattah Middle Mr. Adolfo L. Costa

6411 Horace Mann Middle Ms. Pamela J. Johnson

6571 Norland Middle Ms. Cheryl W. Nelson

6721 Parkway Middle Ms. Paulette Covin-Fredrik

6981 Westview Middle Ms. Lavette S. Hunter

7131 Hialeah-Miami Lakes Senior Ms. Karen L. Robinson

7251 Miami Central Senior Dr. Jerry Clay, Jr. (Co-Principal) Ms. Robin Y. Atkins (Co-Principal)

7301 Miami Edison Senior Dr. Jean E. Teal

7341 Miami Jackson Senior Ms. Deborah Love

7381 Miami Norland Senior Dr. Mark Soffian


SCHOOL IMPROVEMENT ZONE SCHOOLS PROPERTY SCHEDULES

Results of property inventories and an analysis of Plant Security Reports filed by school are:

Work Loc. No. SCHOOLS

CURRENT INVENTORY PRIOR INVENTORY

Total Dollar

Unlocated Items

No. of Unloc. Items

Dollar Value

No. Of Items At Cost

At Deprec. Value

0641 Bunche Park El 78 $ 194,940 None None 2531 Thena C. Crowder El. 96 213,964 None 1 $ 1,695 1441 Paul L. Dunbar El. 131 273,038 None None 2001 Florida City Elementary 201 408,442 None None 2501 Holmes Elementary 57 122,453 None None 2761 Dr. Martin L. King El. 83 201,738 None None 2821 Lakeview Elementary 141 345,946 None None 3021 Little River Elementary 188 338,005 None 1 1,739 3051 Toussaint L'Ouverture El. 109 220,702 None None 5861 Dr.H.R. Mack/W. Lit River El.* 132 277,880 None None 3501 Morningside Elementary 126 310,242 None None 3701 Norland Elementary 390 590,340 None None 4841 Santa Clara Elementary 84 239,693 None None 4961 Shadowlawn El. 154 295,381 None None 5931 Phillis Wheatley El. 149 368,436 None None 6011 Allapattah Middle 320 791,545 None None 6411 Horace Mann Middle 441 832,112 None 18 26,455 6571 Norland Middle 277 564,059 None None 6721 Parkway Middle 155 425,242 None None 6981 Westview Middle 218 463,766 None 2 3,434 7131 Hialeah-Miami Lakes Sr. 800 1,724,375 None None 7251 Miami Central Senior 1,367 2,646,374 22 $39,738 $13,232 23 37,746 7301 Miami Edison Senior 764 1,360,752 None None 7341 Miami Jackson Senior 502 1,213,679 None None 7381 Miami Norland Senior 347 745,270 None None

TOTAL 7,310 $15,168,374 22 $39,738 $13,232 45 $ 71,069 * Inventory results pending since September 2007.

Work Loc. No. Schools

No. Of Plant

Security Reports

Total Items

Total Amount At Cost

CATEGORIES AT COST Total

Depreciated Value Computers Other

2501 Holmes Elementary 1 1 $ 1,049 $ 1,049 - $ 629 3501 Morningside Elementary 1 3 3,774 3,774 - - 4841 Santa Clara Elementary 1 1 1,038 1,038 - 796 4961 Shadowlawn Elementary 1 3 3,764 3,764 - - 6571 Norland Middle 1 1 1,564 - $ 1,564 982 6981 Westview Middle 1 1 1,995 - 1,995 1,596 7251 Miami Central Senior 4 5 6,056 3,307 2,749 3,339 7301 Miami Edison Senior 3 3 4,010 2,998 1,012 777 7341 Miami Jackson Senior 1 2 3,090 3,090 - 1,425

TOTAL 14 20 $ 26,340 $ 19,020 $ 7,320 $ 9,544


FINDINGS AND RECOMMENDATIONS


1. Improve Controls Over Yearbook Activities MIAMI CENTRAL SENIOR Section IV, Chapter 6 of the Manual of Internal Fund Accounting establishes the procedures over the yearbook activity. Pursuant to the guidelines, disbursement policies and procedures set forth in Section II, Chapter 5 of this manual must be adhered to as well. According to internal fund disbursement procedures, advanced payment in full to commercial vendors is not permitted unless the items/services procured are essential to support curriculum instruction. Furthermore, Section IV, Chapter 6 addresses certain charges that should not be included in the yearbook invoice. Because the production of the yearbook is the result of an educational school project offered as part of the academic curriculum, no sales taxes are applicable. For fiscal year 2007, the school solicited the services of a yearbook publisher to publish 200 yearbooks. Our review of the yearbook activity and related disbursements disclosed the following: 1.1. Yearbooks were delivered in mid October even though the publisher had

been paid in full $15,241 as of the end of June. The yearbook sponsor claimed that printing was delayed due to design setbacks, lack of commitment from the student body to purchase the yearbook, and generally very low yearbook sales throughout the year. However, payment made prior to receiving goods/services is not only contrary to procurement guidelines, but a poor business practice.

1.2. Of the 200 books purchased, only 91 were sold. Total sales amounted to

$5,135, which only covered about 36% of the total cost of the yearbooks. Because the individual cost of the books was slightly higher than the individual sales price and 109 books were left unsold at year-end, the school faced a shortfall in yearbook revenues of approximately $9,100. To cover the difference and be able to pay the vendor in full, the school used the balance left over from last year’s activity and held additional fund-raisers during the 2006-07 fiscal year.

1.3. Although the yearbook is exempt from sales taxes, $997 were included in the

invoice and paid by the school.


RECOMMENDATIONS 1.1. Ensure that staff understands and adheres to disbursement procedures. 1.2. Revisit 2008 yearbook activity plans to align purchased quantities with

a more realistic estimate of demand. 1.3. Obtain a refund for $997 for the sales taxes paid.

Person(s) Responsible: Principal, Business Manager, Yearbook Sponsor

Management Response: We concur with these recommendations. On November 16, 2007, the Co-Principals discussed the audit findings with the Business Manager and the Yearbook Sponsor. To ensure that staff understands and adheres to disbursement procedures, the Co-Principals reviewed Section IV, Chapter 6 of the Manual of internal Fund Accounting, specifically focusing on the areas of deficiency found by the auditor. On November 19, 2007, the Co-Principals reviewed the 2008 Yearbook activity plans and aligned the quantities to be purchased with a more realistic estimate of the demand. Immediately following the audit, the vendor was contacted and a request for a refund of the $997 that was paid for sales tax was made. The following preventive strategies will be implemented to avoid exceptions with the Yearbook in the future: The Business Manager will monitor the yearbook activity plans. She will meet with the yearbook Sponsor on a regular basis to review activities and ensure that guidelines, disbursement policies and procedures set forth in Section II, Chapter 5 of the Manual of Internal Funds Accounting are adhered to. A cut-off date will be established to review yearbook pre-sales to determine if the planned purchase quantities were sold. If the quantity is less than planned, then the yearbook activity will be cancelled and alternative options will be explored. The Co-Principal in charge of Business Operations will meet with the Business Manager and assigned Assistant Principal periodically to make sure that these operations are on track and any needed adjustments are expediently handled.


2. Adhere To Limits Over Transfers Of Vending Machine Commissions To The Special Purpose Account MIAMI CENTRAL SENIOR At a senior high school, revenues generated from school-sponsored vending machine operations earmarked for student use must be accounted through the internal funds. Section IV, Chapter 11 of the Manual of Internal Fund Accounting provides the guidelines for operating vending machines and accounting for vending machine revenues (commissions) generated from student patronage. According to the guidelines, principals are authorized to transfer up to 25% of commissions received to the Special Purpose account. In cases where there is a special or a financial need, principals are allowed to transfer additional funds, provided he/she has requested and received authorization, in writing, from the Regional Center Superintendent to do so. 2.1. At this school, vending machine commissions generated from student

patronage amounted to $29,518 for fiscal year 2006-07. Our analysis of the account activity revealed that the school transferred from the Vending Machine account to the Special Purpose account a total of $18,424, which exceeded the established 25% limit ($7,380) by $11,044 without written approval. All funds transferred had been spent by year-end.

RECOMMENDATIONS 2.1. Obtain written approval to transfer vending commissions to the Special

Purpose account that exceed established limits.

Person(s) Responsible: Principal, Business Manager, Treasurer Management Response: We concur with this recommendation. On November 16, 2007, the Co-Principals reviewed the audit finding with the Business Manager and the Treasurer. In order to avoid future audit exceptions, the Co-Principals reviewed Section II, Chapter 7 of the Manual of Internal Funds Accounting, in particular the section pertaining to the transfer of vending commissions. The following preventive strategies will be implemented to avoid exceptions with the Special Purpose Account in the future: The Business Manager will review transfers of vending commissions to the Special Purpose account on a quarterly basis, in order to ensure that they do not exceed the established 25% limit. The Co-Principal in charge of Business Operations will also review transfers to the Special Purpose account, before signing, to ensure that the established limit is adhered to. Written approval will be obtained to transfer vending commissions that exceed the established limit to the Special Purpose account.


3. Improve Controls Over Property Inventory MIAMI CENTRAL SENIOR

The Manual of Property Control Procedures establishes the guidelines for recording and managing property. According to Section 4 and pursuant to Chapter 10.400 of the Auditor General, an inventory of all property shall be taken once every fiscal year. Items on record which cannot be found will be listed as “unlocated” and reported accordingly. 3.1. Current property audit results disclosed that 22 items at a cost of

$39,738 and a depreciated value of $13,232 were reported as “unlocated”. In the prior year’s audit, a similar finding was reported. The school administration had previously provided an action plan to improve property management at the school.

RECOMMENDATION 3.1. Revisit plan of action previously submitted to address property

control procedures with staff and administration, and ensure that the school properly monitors property.

Person(s) Responsible: Principal, Assistant Principal, Business Manager

Management Response: We concur with this recommendation. On November 16, 2007, the plan of action previously submitted to address property control issues was reviewed and discussed with the Assistant Principal in charge of property and the Business Manager. The following preventive strategies will be implemented to avoid an exception with Property Control: The Assistant Principal in charge of property and the Business Manager will conduct property audits on a bi-monthly instead of a quarterly basis. Property audits will also be conducted at the beginning of the school year as well as prior to and after any extended break. The Co-Principal in charge of Business Operations will meet with the Business Manager and assigned Assistant Principal periodically to discuss operations and ensure that any needed adjustments are expediently handled.


OBJECTIVES, SCOPE AND METHODOLOGY The objectives of our audits were to: express an opinion on the internal fund financial statements of

the schools for the fiscal year ended June 30, 2007; evaluate compliance by the schools with the policies and

procedures prescribed in the Manual of Internal Fund Accounting; provide assurances regarding compliance with current payroll

procedures, as well as compliance with the current purchasing credit card program procedures; and certain information technology controls;

verify compliance by the schools with the policies and procedures

prescribed by the Manual of Property Control Procedures, and determine the adequacy of controls over the safeguarding of property items with an individual cost of $1,000 or more;

evaluate compliance with the policies and procedures set forth by

the Title I Administration Handbook and the Title I School-Based Budget System Manual;

While the scope of our audits generally covered operations during the period of July 1, 2006 through June 30, 2007, payroll, property inventory, purchasing credit card transactions, and information technology controls included current periods.


Our procedures were as follows: reviewed written policies, procedures, and School Board Rules; interviewed school staff and performed analytical analysis of

account balances; examined, on a sample basis, transactions, processes,

supporting documentation and records; performed physical inventories of property items with an

individual cost of $1,000 or more; follow-up on prior audit recommendations; and performed various other audit procedures as deemed necessary. Our audits were conducted in accordance with generally accepted governmental auditing standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States of America. We planned and performed the audits to obtain reasonable assurance for our opinions and conclusions regarding the functions under audit. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures herein. An audit also includes assessing the accounting principles used and significant estimates made by the administration, if any. We believe that our audits provide reasonable basis for our opinion. These audits also included an assessment of applicable internal controls and compliance with the requirements of School Board rules and related policies and procedures that would satisfy our audit objectives.


BACKGROUND INTERNAL FUNDS Section 1011.07, Florida Statutes, and State Board of Education Rule 6A-1.087, require annual audits of internal funds. Internal funds are monies collected and expended within a school which are used for financing activities not otherwise financed by the School Board. These monies are collected in connection with school athletic events, fund-raising activities, various student activities and class field trips, after school care and Community School programs, gifts and contributions made by the band or athletic booster clubs, civic organizations, parent-teacher organizations, commercial agencies and all other similar monies, properties or benefits. Prior to spending internal funds, schools invest their cash in designated depositories. Funds not used in the daily operations may be invested in the MDCPS-Money Market Pool Fund. The Fund’s interest rate as of June 30, 2007 was 5.08%. Various fund-raising activities are conducted by independent, school-related organizations such as booster clubs, parent-teacher associations, etc. If these fund-raising activities are conducted entirely by these organizations and no board employee handles or keeps custody of the funds or merchandise, these activities are not recorded in the schools’ internal funds and consequently are not audited by us. PAYROLL All payroll transactions must be processed following the Payroll Processing Procedures Manual, which establishes the guidelines for the recordkeeping, reporting, and maintenance of payroll and payroll records. Each school processes its own biweekly payrolls. Timekeeping personnel enter the employees’ time and attendance data, on a centralized information system. After the information is entered into the system, it is approved by the principal on-line.

Annual audits of internal funds are required by Section 1011.07, Florida Statutes, and State Board of Education Rule 6A-1.087

Internal Funds are revenues generated from student activities at the school level which are not part of the school’s budget process

Each school administers their internal funds separately through an operational checking account

Banks for school funds must be approved by the School Board and certified by the State Treasurer

Idle funds in the operational account may be invested to yield interest revenue in a savings account, certificate of deposit or in the MDCPS-Money Market Pool Fund

At June 30, 2007, the MDCPS-Money Market Pool Fund’s interest rate was 5.08%.


Subsequently, the payroll department reviews the information and processes the payroll. Once the checks/advices are printed, they are distributed throughout the District by Treasury Management. PROPERTY At M-DCPS, the management of property items must comply with the guidelines established in the Manual of Property Control Procedures.. According to Chapter 274.02 of the Florida Statutes, a complete physical inventory of all property shall be taken annually, be compared with the property record, and discrepancies must be identified and reconciled. Accordingly, our office conducts yearly inventories at each school of all property items with an individual value of $1,000 or more, the results of which are reported herein. PURCHASING CREDIT CARD (P-CARD) PROGRAM At the schools, principals administer the purchasing credit card program, which must comply with the guidelines established in the Purchasing Credit Card Program Policies & Procedures Manual. The P-card program was designed to streamline the acquisition process by enabling employees at the schools to make small dollar purchases (less than $1,000 per individual transaction) for materials and supplies. The program is managed by the Office of the Controller. DATA SECURITY QUARTERLY MANAGEMENT REPORT AND APPROVAL REVIEW

Principals are responsible to ensure that only authorized school staff has access to designated computer applications. Information Technology Services (ITS) produces a quarterly report for each school location titled “Authorized Applications for Employees by Locations Report”. Principals are responsible for reviewing this quarterly report to determine the appropriateness of computer applications approved for each school employee, as to whether they are required for his or her assigned duties; and to ensure that access to the computer application that allows for changes to students’ academic grades is limited to a specific and restricted number of authorized personnel at their schools.

The P-Card Program enables schools to make small purchases of less than $1,000 per individual transaction for materials and supplies

It expedites the procurement process at the schools

Control Point: School staff allowed to make changes to students’ grades is limited to:

• principal • assistant principal • registrar


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TITLE I PROGRAM Schools implementing Title I Programs are required to meet the requirements of the No Child Left Behind Act of 2001. Each year, an Economic Survey is conducted by the District to rank schools from highest to lowest, based on the percentage of participating students from low income families, and to allocate Title I funds to those eligible schools in rank order. The cut-off point for eligibility is based on the Title I allocation received from the State and other program components. Schools follow specific criteria for the use of Title I funds as delineated in the Title I Administration Handbook. Purchases of supplies and equipment are processed through regular district channels or via use of the P-card Program, depending on the amount. Salary expenditures must comply with budgetary requirements and must be directly related to activities associated with the grant. To promote schoolwide compliance with Federal, State, and District regulations and guidelines, and ensure that appropriate evidence sources document compliance, the Office of Management and Compliance Audits incorporated the audit of this program into the school audits effective February 2007.

SCHOOL IMPROVEMENT ZONE SCHOOLS ORGANIZATIONAL CHART

School Improvement Zone

Regional Center VI

SUPERINTENDENT OF SCHOOLS Dr. Rudolph F. Crew

REGIONAL

SUPERINTENDENT Ms. Neyda G. Navarro

REGIONAL

SUPERINTENDENT Ms. Enid Weisman

REGIONAL

SUPERINTENDENT Dr. Essie S. Pace

REGIONAL

SUPERINTENDENT Ms. Janet S. Hupp

REGIONAL

SUPERINTENDENT Mr. George A. Nuñez

REGIONAL

SUPERINTENDENT Dr. Marcos M. Moran

Regional Center I Regional Center II Regional Center III Regional Center IV Regional Center V

ADMIN. DIRECTOR

BUDGET/PERSONNEL Ms. Jennifer Andreu

SCHOOL PRINCIPALS

ADMIN. DIRECTOR

BUDGET/PERSONNEL Mr. Robert Kalinsky

ADMIN. DIRECTOR

BUDGET/PERSONNEL Mr. Jorge L. Garcia

ADMIN. DIRECTOR

BUDGET/PERSONNEL Dr. Melanie Fox

ADMIN. DIRECTOR

BUDGET/PERSONNEL Dr. J. Crusé-Sanchez

SCHOOL PRINCIPALS

SCHOOL PRINCIPALS

SCHOOL PRINCIPALS

SCHOOL PRINCIPALS

SCHOOL PRINCIPALS

ASSOCIATE SUPERINTENDENT

SCHOOL OPERATIONS Mr. Freddie Woodson

ASSOCIATE SUPERINTENDENT SCHOOL IMPROVEMENT ZONE

Dr. Geneva K. Woodard

ADMIN. DIRECTOR

BUDGET/PERSONNEL Dr. Jeanethe Thompson

ADMIN. DIRECTOR

BUDGET/PERSONNEL Ms. Marie Harrison

ASSISTANT

SUPERINTENDENT Ms. Blanca M. Valle

This only applies to schools in the School Improvement Zone (39 schools in Regional Centers I, II, III, IV, and VI)

Miami-Dade County Public Schools 20 Internal Audit Report Schools With A Change Of Principal

The School Board of Miami-Dade County, Florida, adheres to a policy of nondiscrimination inemployment and educational programs/activities and programs/activities receiving Federal financialassistance from the Department of Education, and strives affirmatively to provide equal opportunity for all as required by:

Title VI of the Civil Rights Act of 1964 - prohibits discrimination on the basis of race, color, religion, or national origin.

Title VII of the Civil Rights Act of 1964, as amended - prohibits discrimination in employment on the basis of race, color, religion, gender, or national origin.

Title IX of the Education Amendments of 1972 - prohibits discrimination on the basis of gender.

Age Discrimination in Employment Act of 1967 (ADEA), as amended - prohibits discrimination on the basis of age with respect to individuals who are at least 40.

The Equal Pay Act of 1963, as amended - prohibits sex discrimination in payment of wages to women and men performing substantially equal work in the same establishment.

Section 504 of the Rehabilitation Act of 1973 - prohibits discrimination against the disabled.

Americans with Disabilities Act of 1990 (ADA) - prohibits discrimination against individuals with disabilities in employment, public service, public accommodations and telecommunications.

of unpaid, job-protected leave to "eligible" employees for certain family and medical reasons.

scrimination in employment on the basis of pregnancy, childbirth, or related medical conditions.

e basis of race, gender, national origin, marital status, or handicap against a student or employee.

ination because of race, color, religion, sex, national origin, age, handicap, or marital status.

The Family and Medical Leave Act of 1993 (FMLA) - requires covered employers to provide up to 12 weeks

The Pregnancy Discrimination Act of 1978 - prohibits di

Florida Educational Equity Act (FEEA) - prohibits discrimination on th

Florida Civil Rights Act of 1992 - secures for all individuals within the state freedom from discrim

School Board Rules 6Gx13- 4A-1.01, 6Gx13- 4A-1.32, and 6Gx13- 5D-1.10 - prohibit harassment and/or discrimination against a student or employee on the basis of gender, race, color, religion, ethnic or national origin, political beliefs, marital status, age, sexual orientation, social and family background, linguistic preference, pregnancy, or disability.

ral Law) and Section 295.07 (Florida Statutes), which stipulate categorical preferences for employment.

Revised 5/9/03

Veterans are provided re-employment rights in accordance with P.L. 93-508 (Fede

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